SAO PAULO (Reuters) - Planemaker Embraer SA (EMBR3.SA) is counting on the votes of public-sector Brazilian shareholders to outweigh any potential investor objections to its tie-up with Boeing SA (BA.N), two people with knowledge of the matter said.

FILE PHOTO: The logo of Brazilian aviation company Embraer is seen on a factory in Sao Jose dos Campos, Brazil, February 7, 2018. REUTERS/Paulo Whitaker/File photo

Doubts about the valuation of Embraer’s commercial jet unit in a proposed $4.75 billion joint venture sent Embraer shares tumbling nearly 15 percent in a single day last week, although shares are still up 32 percent since the deal was first reported.

Some small investors have complained the deal effectively gives Boeing control of Embraer’s main business without having to pay the 50 percent premium called for in a poison pill in the planemaker’s bylaws. Top foreign shareholders have so far kept mum on the issue.

Even if those offshore investors do object, however, one of Embraer’s little-known corporate bylaws will effectively give a Brazilian-held share about six times the weight of a foreigner’s at a shareholder assembly, according to the sources who requested anonymity to discuss the deal publicly.

The support of public-sector pension fund Previ and state development bank BNDES, which together hold about 10 percent of Embraer shares may thus prove decisive, the sources added, underlining the sway of the Brazilian government which also has a “golden share” in the formerly state-controlled company.

Embraer, Boeing and Previ declined to comment on the matter.

BNDES did not reply to questions.

LITTLE-KNOWN BYLAW

Embraer’s corporate statutes grant Brazilians at least 60 percent of voting rights at shareholder meetings, even though domestic shareholders held just 19 percent of Embraer’s outstanding shares as of March, according to the company — and about half of those belong to Previ and BNDES.

BNDES, which holds the shares through investment arm BNDES Participações SA, was part of a government working group discussing the tie-up along with representatives of the finance and defense ministries. BNDES head Dyogo Oliveira on Tuesday said it was “certainly a good deal.”

Previ, which manages pensions for employees of state-controlled lender Banco do Brasil SA (BBAS3.SA), has not made its stance on the deal public.

Embraer’s top shareholders, Brandes Investment Partners LP, BlackRock Inc (BLK.N) and Mondrian Investment Partners LP may also have their say limited by a bylaw restricting the voting rights of investors with more than 5 percent of shares — the case for all three as recently as March.

All three fund managers declined to comment.

SHAREHOLDER RESISTANCE

While Embraer shares are still up 32 percent since Boeing disclosed its interest, some analysts have suggested investors were shortchanged by the U.S. jetmaker’s final offer.

The lack of a full takeover offer for Embraer, including its defense and business jet operations, was a result of the Brazilian government’s concern about the sovereignty of military programs, backed up by its golden share.

“We see strong odds of Embraer shareholders demanding a higher price for the stake in the commercial segment, given this unit’s strategic value and low financial impact on Boeing,” BTG Pactual analyst Renato Mimica wrote in a Thursday note.

A local fund manager holding less than 1 percent of Embraer shares, who asked not to be named to preserve relations with management, said the valuation was low and asked why investors other than BNDES had not been previously consulted on the deal.

Facing an uphill battle at the shareholder assembly, Renato Chaves, a former director at pension fund Previ, filed a formal complaint to Brazilian securities regulator CVM last week.

Chaves argued the deal was designed to avoid Embraer’s poison pill ensuring an offer to all shareholders with a 50 percent premium over market prices if any investor buys 35 percent or more of the company.

“What I see is Embraer selling 85 percent of its revenue to Boeing, and the poison pill should apply,” said Chaves. “What they are doing is a disguised acquisition designed to avoid the poison pill.”

CVM does not comment on investor complaints beyond its public decisions.